New Medi-Cal Laws (2017 Update) – Why You Want Your Estate to Avoid Probate

New Medi-Cal Laws (2017 Update) – Why You Want Your Estate to Avoid Probate

How California Intends to Recover Medi-Cal Funds

When a person who has received Medi-Cal benefits passes away, the state can seek recovery of some of the funds paid out while assets are in probate. Here’s an example of how it would work.

Let’s say a widowed woman named Mary own’s a home in California. Late in life, she receives $100,000 in Medi-Cal funds to cover time she spends in a nursing facility. When she dies, her home goes into probate and is sold for $300,000. The state takes back the $100,000. Mary’s adult heirs are thus left with $200,000.

That’s just a simplified version of how the process works. Basically, if a person dies without a spouse or minor children, numerous expenses could be recouped by the state and reduce the inheritance that heirs receive.

Smart Estate Planning Avoids Medi-Cal Recovery

Medi-Cal recovery won’t affect a family trust. This is because the trust doesn’t go to probate, so the state never has the opportunity to stake a claim on funds. This makes estate planning an important factor for anyone who is benefiting from the Medi-Cal system. Using a trust instead of a will is a great way to make sure your loved ones get your entire estate, rather than paying back your Medicaid benefits posthumously during probate.

The Petrov Law Firm would be happy to help you determine how to make sure your family gets your estate, rather than having to share it with the state. Just call 619-344-0360 to start your estate planning today.